Gates close as credit crunch bites
PUBLISHED: 14:16 30 December 2008 | UPDATED: 10:51 11 August 2010
WORKERS at Ford s Dagenham plant are getting a longer Christmas break than usual as the credit crunch hits demand for engines. Parts of the estate have closed down a week early, with employees told to stay at home on full basic pay. The press shop and pro
WORKERS at Ford's Dagenham plant are getting a longer Christmas break than usual as the credit crunch hits demand for engines.
Parts of the estate have closed down a week early, with employees told to stay at home on full basic pay.
The press shop and production lines manufacturing the larger 2.7 and 3.6 litre engines shut down on Monday, December 15. The stamping division closed two days later.
It is normal for the factory to close over the festive season for maintenance work, but the closures were earlier than the planned date of December 23.
All staff are expected to be back at the plant on January 5.
Good news is that 1.4 litre and 1.6 litre diesel engines, which account for 65 per cent of Dagenham's total production, are still in demand, and those production lines are so far unaffected by the credit crunch.
These engines run at 75 miles to the gallon, a level of efficiency extremely attractive to modern consumers.
So far, no permanent staff have been laid off at Dagenham, but 200 temporary staff have had their contracts terminated.
The redundancies were all in engine production, and were implemented in two waves - one at the end of October, and the second at the end of November.
Motor manufacturing is suffering more than most sectors from the effects of the recession.
Just 97,604 cars were made in Britain in November, 44,500 down on November 2007.
Last week, Jaguar Land Rover appealed to the British government for a £1 billion bail out.
This will worry the Dagenham workforce because the brands, sold by Fords to the Indian company, Tata in March, are major customers for the Dagenham-made engines and parts.
Ford Britain has not asked for government money to help with production costs, but they are appealing for assistance to provide credit to consumers.
One of the main factors stalling new car sales is the fact that potential buyers cannot get loans to buy them.
Fords is in a stronger position than the other 'big three' American manufactures. They have not asked for multi-billion dollar bailouts from the US government, like their Detroit rivals, Chrysler and General Motors.
But if the other two companies were to fold there would be a painful knock-on for Fords in the United States.
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